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Thursday, June 12, 2014

Telecom Italia: timing of Argentina sale uncertain

ROME — Telecom Italia CEO Marco Patuano was unable to say yesterday when the Italian telecommunications group would complete the US$960 million sale of its Argentine unit, suggesting that finalizing deal may be taking longer than originally thought.

Telecom Italia agreed to sell its stake in Telecom Argentina to the Fintech investment company of Mexican billionaire David Martinez in November 2013, saying the deal was subject to a green light from local regulators.

Speaking on the margins of an event in Rome, Patuano said he saw no obstacles to completing the transaction. Asked to give a specific timeframe he replied: “It is never possible to have a date when you deal with regulators”.

“I’ve been in Argentina in the last few days speaking to authorities: there are no obstacles and we are going ahead, the only thing that is missing is a decision from (Argentina’s telecoms authority) Secom,” he added.

In March, finance chief Piergiorgio Peluso said Telecom Italia had already cashed in a first tranche of US$109 million related to the deal, with the balance expected within the first half of 2014.

The sale of Telecom Argentina is part of a 4-billion-euro (US$5.4 billion) plan designed by Patuano to help cut debt and fund investments needed to upgrade Telecom Italia’s domestic assets and head off competitors.

Telecom Argentina CEO Stefano De Angelis said last month investors could expect some news on the sale in the third quarter given that the contract envisaged an August deadline. A completion of the deal could also trigger a takeover offer for Telecom Argentina by US-based Fintech.